Forex Today: Fed drives dollar higher, gold and stocks lower, BOE, jobless claims eyed

Here is what you need to know on Thursday, September 17:

The Federal Reserve's reluctance to signal more stimulus despite cautious forecasts is weighing on stock markets and boosting the safe-haven dollar. Weekly jobless claims and the Bank of England's decision stand out on Thursday.

Fed: Jerome Powell, Chairman of the Federal Reserve, stressed that the outlook is uncertain yet said that the current level of bond-buying is appropriate. The Fed did not surprise markets by hinting that interest rates will likely remain at zero through 2023. 


Powell also indicated that additional fiscal stimulus will likely be needed, seemingly passing the ball to lawmakers' court. According to reports, Democrats and Republicans are getting closer to a deal on an injection of around $1.5 trillion.

The new impetus comes after retail sales disappointed with a meager increase of 0.6% in August. The Control Group dropped by 0.1% and all the recent figures came on top of downward revisions. The shortfall seems related to the lapse of government programs at the end of July. 

See Retail Sales Analysis: Miserable figures good for gold as fiscal help could come sooner

Weekly jobless claims (see preview) are set to show a small drop for the week ending on September 11, when Non-Farm Payrolls surveys are held. The Philadelphia Fed Manufacturing Index, and housing figures are also of interes.

President Donald Trump contradidcted his own top health officials by claiming a vaccine is coming shortly. Robert Redfield, the head of the Center for Disease Control, and leading epidemiologist Anthony Fauci foresee broadly available immunization to come only in mid-2021. 

Brexit: Prime Minister Boris Johnson has ceded ground to "rebels" in his Conservative Party and allowed for greater parliamentary oversight over the controversial Internal Markets bill. The legislation knowingly violates the Brexit accord Johnson signed with the EU last year. The pound advanced in response.

The focus shifts to the Bank of England, which is widely expected leave its policy unchanged. Investors will watch the BOE's guidance amid a stop-start economy. Local lockdowns are enacted in various places in Britain and new restrictions may be added. 

See BOE Preview: Fast recovery or trio of troubles? Bank's tone to set pound's direction

The Bank of Japan left its interest rate unchanged at -0.1% as expected, in its first decision after Yoshihide Suga replaced Shinzo Abe as prime minister. The Tokyo-based institution upgraded its forecasts. USD/JPY is trading around 105, rising amid dollar strength and not falling on safe-haven flows.

AUD/USD is trading below 0.73 amid the risk-off mood. However, Australia reported an increase of 111,000 jobs in August, far above expectations and boosting the Aussie. 

NZD/USD is trading around 0.67, down on the greenback's strength and as second-quarter Gross Domestic Product dropped by 12.2%, within broad expectations.

OPEC+ members are set to leave oil production goals unchanged. WTI is trading closer to $40. While the damp market mood is weighing on petrol prices, Hurricane Sally and other brewing storms are limiting output and boosting oil prices.

Cryptocurrencies are holding onto recent gains, with Bitcoin trading around $11,000.

More: 2020 Elections: How stocks, gold, dollar could move in four scenarios, nightmare one included

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

AUD/USD: Bounces off one-week low on Powell-Mnuchin comments, eyes RBA

AUD/USD probes pullback from multi-month high ahead of the key data/events. Fed Chair Powell conveys economic worries, US Treasury Secretary Mnuchin pushes for stimulus. Risks dwindle amid economic fears, uncertainty over the US covid aid package.


Gold: Wobbles near five-month low below $1,800 as Powell, Mnuchin weigh on risks

Gold prices seesaw around $1,77/78 during the early Tuesday morning in Asia. The yellow metal dropped to the lowest since July the previous day before bouncing off $1,764.73. Economic fears, need for stimulus raise bars for the bull’s entry.

Gold news

EUR/USD retreats after its first attempt to break above 1.2000

EUR/USD trades around 1.1940 after failing to break above the psychological threshold. Bulls retain control and would likely challenge the level once again.


Ripple Price Prediction: XRP sits on the verge of an explosive breakout

XRP traded as high as $0.78 on November 24 before a brief period of a correction down to $0.456. Ripple price is trading at $0.655 at the time of writing, notably recovering from the dip and aiming to set higher highs.

Read more

Black Friday 2020 Discounts!

Learn to trade with the best! Don't miss the most experienced traders and speakers in FXStreet Premium webinars. Also if you are a Premium member you can get real-time FXS Signals and receive daily market analysis with the best forex insights!

More info